Tuesday, December 20, 2016

DUs prodded on investment strategies to pare system losses



Published December 1, 2016, 10:01 PM By Myrna M. Velasco

The country’s power distribution utilities (DUs) – giant players and the electric cooperatives (ECs) alike – have been required to lay down investment strategies on how they can further reduce their respective system losses so these can help bring down the rates paid for by consumers.
In a hearing called by the Senate committee on energy, the power utilities have been asked on the scale of investments they have been making and how such correspond to system loss reduction.
Senate Committee on Energy Chairman Sherwin T. Gatchalian primarily asked the Energy Regulatory Commission (ERC) to undertake a study on comparative system loss levels of power utilities of various markets and benchmark it with how the Philippine DUs have been performing on that sphere.
For Meralco that had been continuously improving on its system loss reduction targets, the lawmaker required it to submit new investment plans as well as its internal cost benefit analysis.
Gatchalian similarly required the utility firm to present data on its investment “versus how much system loss that we can reduce and the impact to the consumers.”
Meralco noted that over the years, it already forked out capital of R12 billion for installations of some 7,800 elevated metering centers (EMCs) that then served as its investment strategy to substantially pare its system losses to the level of 6.0 percent and even lower on some billing months.
The next phase of investment, it said, will be its proposed advanced distribution management system (ADMS) that will primarily require it to roll out more modern and data-driven metering infrastructure – that shall also be a vital component of the company’s multi-year smart grid journey.
Meralco noted “every time we procure an equipment to form part of our system, it is always part of our criteria to look at efficiency and its effect on technical losses.”
The utility firm assured “we buy high quality power transformers because of technical loss component, and the same for our distribution transformers… we also continuously replace aging and dilapidated secondary wires.”
Many other private distribution utilities are on parallel investment trajectories when it comes to targeted system loss reductions.
But for the ECs, capital injection approaches are seen more diverse.
System losses for ECs are still at higher levels of 10 to 13 percent on average, with some even loftier depending on the geographical characteristics of their service areas as well as the density and profile of customers and end-users.
According to the Philippine Rural Electric Cooperatives Association Inc. (Philreca), “one contributory factor is the configuration of the system,” citing that “in a certain province, it depends on how the populace is located… variation that goes along with DUs is not identical.”
The EC group similarly noted that very often” their “physical infrastructures are different and that big contribution (to system loss) would be equipment and materials used.”

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